Should We Stay Or Should We Go?

Thursday, 23rd June: Sterling reached 2016 highs against the dollar as EU Referendum day finally arrived. Poll stations have been open since 7am this morning and don’t close till 10pm. Latest polls still reflect a swing towards a “remain” vote; Betfair are predicting an 84% sway towards a vote to stay in the EU (at the time of writing) (http://politicalodds.bet/eu-referendum). Sterling reached nearly $1.50 during European trading and has reached its highest level against the green note since December 28th 2015. The FTSE has climbed to 2-month highs as investors followed momentum towards a “remain” vote, closing out at +1.23% for the day.

Tesco has today released a trading statement, reflecting performance over their second quarter of the year. UK like-for-like sales increased by 0.3%, the second successive quarter of increased sales growth, the first time the Supermarket has done so in more than 5 years. Tesco’s has been trying to get back to what it is good at under Dave Lewis and of late has sold the Giraffe restaurant chain and Dobbies Garden centres. It has also sold businesses in South Korea and Turkey as they attempt to cut debt an simplify the business model. However, no more asset sales are expected. Tesco remains the biggest supermarket in Britain with a market share of more than 28% (according to Kantar data). Their shares are c.20% up year-to-date, but have fallen back from March highs (>+40% gains). The shares closed +0.81% at 167.8p.

The group stages of Euro 2016 were concluded last night. Iceland, the smallest country to ever qualify for a major international football tournament, surprised everyone by beating Austria to finish above Portugal. To put Iceland’s size in to context, nearly 27,000 Icelanders have travelled to France to watch their team. This equates to more than 8% of the island’s population – if England took the same proportion of fans, 4.2m fans would have travelled to France to support the national team. Iceland has a population of c.331,000, which, according to the most recent ONS statistics, is the same amount of Irish people who live in Britain. It is also less than the populations of Bradford, Kirklees and Fife.

Markets in Europe followed suit ending the day higher: the CAC closed +1.86% and the DAX +1.85%. In the US the Dow Jones and S&P 500 are both high by just shy of 1% (at time of writing).